The average shape of the yield curve over long periods of time suggests that a. The...
The average shape of the yield curve over long periods of time suggests that
a. The average interest cost of an ARM will be lower than for an FRM
b. The average cost of an FRM will be lower than an ARM
c. The cost of an FRM and ARM will average out to be the same
d. Prepayments will be faster under an ARM
Homework Answers
In average shape of yield curve shows that the interest rate with the higher maturity are higher than the lower maturity subject that the credit risk is same.
So the average cost of an FRM will be lower than an ARM,
Add Answer to:
The average shape of the yield curve over long periods of time
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